Undergraduates at the Massachusetts Institute of Technology will be given $100 (£59) worth of bitcoins when they return to study this autumn, in an attempt to jumpstart a bitcoin ecosystem.

The project is being led by Jeremy Rubin, 19, an undergraduate in his second year at the university, and Daniel Elitzer, an MBA student at MIT's Sloan School of Management. Between them, the pair have raised more than $500,000, principally from Alexander Morcos, an MIT alum who works in high-frequency trading in New York.

"We decided to announce this project now to give students lead time," says Elitzer. "We want to issue a challenge to some of the brightest technical minds of a generation: ‘When you step on to campus this fall, all of your classmates are going to have access to bitcoin; what are you going to build to give them interesting ways to use it?'"

"Giving students access to cryptocurrencies is analogous to providing them with internet access at the dawn of the internet era," adds Rubin.

Both Rubin and Elitzer have prior experience with bitcoin. The former is the developer of Tidbit, a project to replace online advertising with bitcoin mining, while the latter is the president and founder of MIT's Bitcoin Club.

Created in a hackathon in November 2013, Tidbit was proof-of-concept that would let website owners mine bitcoins on visitors' computers rather than show them adverts. The project ran into difficulty when it was targeted by the New Jersey division of consumer affairs, and Rubin is currently being supported by the EFF, the online-rights charity.

Rubin and Elitzer first met in the fallout of the Tidbit subpoena, and while the concept of the giveaway was initially Rubin's idea, the pair expanded it together. "I am not super involved in the Bitcoin community," says Rubin, "but it is one of the subjects which I frequently think about. Dan has many more ties in the community."

Speaking to the Tech, MIT's student newspaper, the university's head of undergraduate education, Dennis Freeman, supported the bitcoin giveaway. "By bringing students and faculty together to inform members of the MIT community about what bitcoin is and to research its use, Rubin and Elitzer are helping everyone to better understand this emerging technology."

Rubin and Elitzer's plan echoes other giveaways common across the bitcoin community. In April 2013, a user on Reddit calling themselves the "Bitcoin Billionaire" gave away over $13,000 in the currency, using a function on the site that lets users "tip" each other in bitcoin. Normally, the tips are for around 50¢, but the anonymous user was giving away up to 20 bitcoin at once. At the time, bitcoin was worth around $200 a coin, making that single gift the equivalent of $4000.

In many cases, the aim is similar to Rubin and Elitzer's: if more people own bitcoin, there is more chance that the currency will reach a critical mass where it will be able to support itself.

But for the MIT Bitcoin Club, there's the additional benefit that making bitcoin popular in the middle of one of the highest concentrations of hackers, coders and engineers in the world could be key to building up infrastructure for the cryptocurrency. Part of the reason for announcing the giveaway early, they say, was to encourage local businesses to get set up to take bitcoin payments.

"This will spark new development," says Rubin. "Even if students simply use their bitcoin to buy stuff, someone has to build an architecture to enable buying stuff. And what if buying with bitcoin is really convenient? Maybe there will be an active conversion into bitcoin."